I think that he is at least partially right. Putting a kote gaeshi on someone is going to have painful unintended consequences. The only person I've ever really hurt in the dojo was a Tae Kwon Do nidan who decided to resist my sankyu. Pop! He said he was ok, but we didn't see him again (disclaimer, he could have kicked my butt as he'd done a bunch more TKD than my Aikido at that point). So from the perspective that our techniques would hurt someone I agree. But their going down in a funky place, while probably true, doesn't seem like a major issue to me. I can deal with that.

The aikido exponent, in other words , can never practice his technique against an opponent for real

Here, I disagree. No art practices for real. People don't walk away from that kind of thing and of necessity it escalates. Real to one person might be to square off in the Octagon but to another it will mean a baseball to the back of your head while you are asleep in your home and to still another it will mean a car accident 3 years later. Real gets more real than I want any part of.

Also, Judo has rules and I bet they don't punch or bite much in their classes or tournaments.

the romanticized sense of self that one sees in aikido practitioners who believe that they can effortlessly "blend" with any attack and neutralize it."

This does seem harsh but it's definitely there. Look around and you'll see examples of it. It also gets misconstrued because we practice with a fundamentally different philosophy than other arts. I think the benefit to Aikido is that we have something to scale down to and practice it. I've heard stories of Judo people disabling attackers by bouncing their heads off a car and concussing them into unconsciousness--after the second or third attack (forget how many). It's also kind of hard to scale down a punch.